Tag: employee turnover

Here’s Why 79% of Talented Salespeople Quit

Posted on by hiredna

While today’s sales brands face numerous challenges, one of the biggest is salesperson retention — an issue that’s especially pressing for smaller businesses. A recent study even found that 55% of companies cited retention as the number one challenge, officially usurping lack of capital.

I’ll be the first to admit that solving the retention problem isn’t easy. It’s incredibly complex with a long list of ever-changing variables. That said, there is some low-hanging fruit that’s a great starting point. And that’s what I want to tackle in this post.

Here’s why 79% of talented salespeople quit and what you can do about it.

A Lack of Appreciation

Let’s get right down to it. There are countless reasons why salespeople quit. Better pay, a lack of career development opportunities, and a poor work-life balance are just a few that come to mind. But a recent study found that one of the biggest contributors to turnover is simply not being appreciated.

“A whopping 79% of employees will quit their job because of a lack of appreciation from leaders,” explains Georgi Todorov of Thrive My Way. To be fair, this stat doesn’t say that nearly four out of five salespeople have quit because of a lack of appreciation. It just says that they will quit.

But from this data, we can confidently say that a lack of appreciation is one of the biggest reasons companies lose elite talent.

Looking Closer into Why Salespeople Quit

A few years back in 2017, Forbes wrote an interesting article about the correlation between a lack of appreciation and turnover. In it, they mentioned that “66% of employees say they would ‘likely leave their job if they didn’t feel appreciated.’ This is up significantly from 51% of employees who felt this way in 2012. Among millennials, the number of employees who’d leave if unappreciated jumps to 76%. This helps account for the overall increase from the 51% figure in 2012, as millennials are becoming the dominant generation in the workforce, with a unique set of characteristics and needs.”

Now that we’re in 2022 and millennials have saturated the workforce even more and will continue to be the dominant force for years to come (take a look at the graph below), it’s easy to see why the number of salespeople who say they’ll quit because of a lack of appreciation has swelled to 79%.

No, Millennials will NOT be 75% of the Workforce in 2025 (or ever)!

While being appreciated has always been important, it appears to be especially important for younger demographics. A separate article by SHRM corroborates this idea, saying that recognition is huge for millennials, as well as Gen Z, which is starting to enter the workforce in larger numbers.

From a Turnover Risk to a Loyal Employee

Something else I found interesting was that placing a larger focus on employee appreciation can help companies go from battling turnover to having a team of highly engaged, loyal, dedicated salespeople. And this is especially true for younger reps.

“While some employers may see these young workers as disloyal or unmotivated, the truth is that they can be turned into an organization’s most enthusiastic and valuable resource when shown appreciation for their work and rewarded in the right way,” notes Rodney Mason, CRO of payroll technology firm daVinci Payments.

More specifically, 79% of salespeople say increasing recognition rewards would increase their loyalty.

Zooming out, nearly four out of five salespeople will quit because of a lack of appreciation. But conversely, the exact same number say increasing appreciation would boost their loyalty. So you can see firsthand just how big of an impact there can be.

Going After the Low-Hanging Fruit

While knowing that such a large percentage of your salesforce could potentially quit for one single reason is a little frightening, at the same time it’s good news because the solution isn’t rocket science. In fact, it’s incredibly simple. You just need to show appreciation.

There are several ways to go about this. Some brands go all out and create a formal employee recognition program (you can learn how to create one here if you’re interested). Some write blog posts with the sole purpose of spotlighting salesperson achievements. Some show their appreciation on social media, and so on.

But it doesn’t have to be this formal. At the end of the day, it just boils down to baking appreciation into your company culture and your daily interactions. And these five tips are a great starting point.

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This is one of the easiest ways to get your turnover under control, build stronger relationships within your company, and gain a competitive advantage. And it doesn’t require you to shell out huge salaries, offer over-the-top benefits, or implement game-changing career development opportunities. You simply need to appreciate your sales reps.

Understanding Why Salespeople Quit (And Fixing It)

Turnover is complex, with countless hours and big money often being spent trying to reduce it. While there is no magic bullet for curbing turnover, understanding the psychology behind why many salespeople quit is a critical first step. And as we’ve learned in this post, one of the biggest reasons is simply due to a lack of appreciation.

Fortunately, this isn’t something that takes deep pockets or a robust HR department to fix. You just need to adjust your mindset and make employee appreciation a focal point. Do that effectively, and your retention rate can’t help but improve.

Find out how HireDNA can not only help you find better sales talent faster but retain salespeople longer. By using cutting-edge technology like intelligent matching and science-based assessments, HireDNA eliminates 96% of hiring mistakes and reduces turnover by more than 33%.

Salesperson Turnover is Up 25%: What to Do About It

Posted on by hiredna

It’s an interesting time for sales recruiting. We’re at a point where the worst of the pandemic is over, and things have steadily gotten back to normal, albeit it’s “a new normal.” As you might imagine, this has created some significant changes, with the rise of remote work and video conferencing being some of the biggest.

Besides that, there’s been an alarming rise in salesperson turnover, where it’s up substantially from a couple of years ago. For this post, I’ll examine this trend in-depth to understand why it’s happening and how to respond.

A Sharp Rise, Then Gradual Fall in Unemployment

First, it’s important to understand the context of how things got to their current state. In early to mid-2020, when COVID got into full swing, there was a sharp rise in unemployment. It went from being just under 4% in February 2020 to nearly 15% by April.

At that point, many sales professionals were scrambling to find work, with many making the shift from a brick-and-mortar setting to remote. However, as things began to stabilize, so did the unemployment rate, and by December 2021 it was back to around 4%. This brings me to my next point.

A Surge in Flexible Work and SaaS Companies Hiring Salespeople Outside Their Industry

The backlash of COVID has had far-reaching implications, not all of which are currently known. But two particular changes that have impacted the sales industry are growing flexible work options and SaaS companies hiring outside their industry. With “the genie being out of the bottle” with remote and hybrid work models and stiff competition with high-paying tech companies looking for top talent, it’s created an employee market.

Now that the worst of the pandemic is behind us, salespeople with robust skill sets are looking for the best possible jobs. And this led to another trend — higher turnover.

Salesperson Turnover Increased By 25%

Under normal circumstances, the average salesperson turnover rate hovers around 10%. But that number has more than doubled over the past couple of years.

“One consistent theme we’re seeing,” writes Karin Kimbrough, Chief Economist at LinkedIn is that “workers across the globe are eager for change and are ‘voting with their feet’ by taking their experience and skills to new roles at an accelerated pace. Globally, the share of members changing roles in October was up 25% compared to the pre-pandemic period in October 2019.”

As a result, this has made it far more difficult for companies to retain top sales talent — an issue that can be frustrating and detrimental to their bottom line.

Why Has Salesperson Turnover Increased?

I touched on the reasoning earlier with the increased desire for sales reps to have more flexible work options and higher pay. But let me unpack this a bit more. According to LinkedIn, the three main reasons for increased salesperson turnover are better compensation (54%), better alignment with employee values (48%), and more opportunities to move up (44%).

It’s clear that elite salespeople in 2022 have far more leverage than they did during the height of the pandemic. This combined with the highest inflation rate in 39 years at 7% has basically created a bidding war that shows no signs of stopping any time soon. That’s why salespeople looking for better compensation is the number one reason for high turnover.

Beyond that, the added leverage today’s sales reps have has resulted in them seeking employers that have matching values and more career advancement opportunities.

How to Handle the Spike in Turnover

This begs the question. What exactly should you do about this trend?

The short answer is to make sure you’re offering competitive pay. Recent reports indicate that the average salesperson’s salary in 2022 is around $60,000. However, those in the top 25% earn closer to $89,000. So that’s a pretty good range to aim for when deciding how much to pay new hires.

Keep in mind, though, that the salesperson’s salary outlook has increased significantly since 2010, so you’ll likely need to keep raising it steadily as time goes on. Besides that, it’s helpful to offer the right benefits, as this can serve as an added incentive to pull in the best and brightest in your industry. I wrote a post about the top 10 benefits today’s salespeople are looking for based on concrete data, and that’s a great starting point.

Here’s an overview for reference.

But what if offering a high salary just isn’t an option?

In that case, I recommend focusing on two key areas as selling points — schedule flexibility and advancement opportunities. With many of today’s top salespeople valuing remote working arrangements, a healthy work-life balance, and the chance for growth, this can be very appealing and give your brand a competitive edge.

Wrapping Up

COVID turned the world on its head in more ways than one. And we’re still feeling the aftershocks long after the pandemic reached its peak.

The bottom line is that salesperson turnover has reached record highs in 2022 and won’t likely change any time soon. But with the right game plan and an understanding of what top reps are looking for, you should still be able to hire elite talent, and more importantly, retain them.

Looking to hire better sales talent faster? See how HireDNA can help using intelligent matching and science-based assessments. 92% of candidates recommended by HireDNA climb to the top of their sales force within the first year and turnover is lowered by an average of 33%.